OP-INDEPENDENT: The myth of the middle class

Friday

Jul 25, 2014 at 10:42 AMJul 25, 2014 at 11:08 AM

As we approach the midterm elections, both Democrats and Republicans claim to be the party that can restore America's middle class to its former glory. Truth be told, the middle class may have been nothing more than a temporary and unsustainable societal blip in our country's history. And chances of its near-term recovery are slim to none.

Michael Weymouth

As we approach the midterm elections, both Democrats and Republicans claim to be the party that can restore America’s middle class to its former glory. Truth be told, the middle class may have been nothing more than a temporary and unsustainable societal blip in our country’s history. And chances of its near-term recovery are slim to none.

The surge in middle class growth occurred in the years following World War II when American manufacturing prowess was primed and ready to take off. At the same time the economies of much of the rest of the industrialized world were in shambles, having been bombed relentlessly by the allies during the war. With a decades-long head start, U.S. manufacturing jobs were plentiful as was the negotiating power of labor, which in turn led to higher wages that began to fuel the economic base for the middle class. This vast pool of money trickled down to myriad small business owners who further expanded the ranks of the middle class. The Golden Goose was in full, egg-laying mode and with so much disposable income we became a giant consumption machine for our own products, which led to further manufacturing growth to meet consumer demand. As time passed we may have suffered bouts of inflation, economic stagnation and mild recession, but these were just wrinkles in an otherwise resilient economic fabric.

Then came globalization and a reminder of how temporary and fragile prosperity can be.

Jobs began to go overseas in the early nineties at about the same time the so-called culture wars were beginning to take root that spawned the political divide we have today, and rather than acknowledge that globalization was the cause of our economic decline, politicians began pointing fingers. Liberals blamed the failure of trickle-down economics, and conservatives blamed the corrosive effects of high union wages and outrageous pensions negotiated by public and private sector unions, as well as excessive government spending. In fact the core problem was, and remains, job-loss due to globalization. If there is legitimate blame here it is that both political parties never took constructive steps to prepare the manufacturing workforce for what was surely an impending catastrophe. Instead they told their constituents what they wanted to hear in order to get re-elected, rather than telling them what they needed to hear: That the good old days were most likely behind us and we had better learn to live on less, a lot less.

The changing statistics are all too apparent.

In 1950 if you wanted to begin your middle class journey by buying a home, your salary had to be roughly one half the cost of the home. The cost of yearly college tuition relative to a family’s income was equally user friendly. Those metrics today are ancient history.

When Social Security was first implemented, the average age of men was 59, women 63.9, which meant that far fewer payments had to be made when compared to today where life expectancy is 76 for men and 81 for women. In the ensuing years, Medicaid and Medicare were added as safety nets for an aging population, the costs of which were destined to grow even larger because of the Baby Boomers. In addition, if you think of Social Security and entitlement programs as Ponzi schemes, today’s lower birth rate does not help.

Surely our leaders saw this coming, especially as the effects of globalization began to set in and diminish the average American’s income and resulting tax base.

But at the end of the day, which is only fitting in a society “of the people,” the real culprits were not our politicians, but individual citizens, for they too should have realized where things were headed and demanded that their elected officials take the long view and plan accordingly. Instead voters continued to flock to those politicians who told them they could have their cake and eat it too.

In the meantime, the American middle class is now ranked 19th among industrialized nations, below Japan, Canada, Australia and much of Western Europe.

One can only imagine the electoral chances of a politician today who tells voters that unemployment for unskilled workers will remain high and that low-paying jobs will be the norm going forward and that if he were elected, he could not change these circumstances in the foreseeable future. Instead he would work with his colleagues in Congress on a long-range plan to revitalize our middle class and hopefully begin to raise Phoenix from the ashes. He would not speak of cutting spending or taxes, as so many conservatives would have us do, but of taxing the wealthy to fund training programs for those unskilled workers who need contemporary skills in order to rejoin the workforce. He would speak of revamping our education system to channel academically challenged students into skill sets that would enable them to get jobs more easily instead of forcing them to study subjects that they will most likely never need. In short, he would make it his goal to ensure that every down-and-out American is able to at least reach the bottom rung on the ladder of opportunity.

Until our leaders begin to make these types of long-term plans, all we can do is sit and watch our middle class continue its slow decline.

Michael Weymouth, 29 Water St., is a regular columnist for the Hingham Journal.